Director’s breach of duty to company can lead to personal liability for unfair prejudice to minority shareholders
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Director’s breach of duty to company can lead to personal liability for unfair prejudice to minority shareholders
In the case of Maidment v Attwood and Others [2012] EWCA Civ 998, the Court of Appeal found that if a director’s conduct had been the cause of the company’s insolvent liquidation this was, on appropriate facts, capable of founding a direct claim against them by a minority shareholder which would otherwise have been entitled to a surplus distribution. On the facts, the case was sent back to the lower court to assess whether, if it had not been for the director paying himself excessive remuneration, failing to collect a licence fee on use of company trading style and selling assets at a value sufficient only to cover the winding up costs, the minority shareholder would have had valuable shares for which he should be compensated.
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